Things didn't go according to plan?
Last night the US raised tariffs on #China to 104% (previously 34%).
At the same time, the yield on US government bonds is rising sharply to 5.47%. This is due to the fact that hedge funds are selling off bonds to cover margin calls, and also because foreign governments (including China) are dumping US securities in response to new tariffs.
As a result, more than $10 trillion left the stock market, which, theoretically, should have led to a decrease in bond yields - but the situation is the opposite, they continue to sell off, and yields are only growing (it seems China has found where to put pressure).
Rising 10-year yields mean higher rates across the financial system, especially mortgages, and wider credit spreads, all of which increase the likelihood of a recession.
And now the US urgently needs a trade agreement with China to somehow stabilize the situation.
Until then, this is the new reality.